John Pulliam: There still is hope for Sandburg Mall

JOHN R. PULLIAM

Sunday

Jul 31, 2011 at 12:01 AMJul 31, 2011 at 2:47 PM

"Business Notebook" -- Last week I wrote a story in which I suspected I was not getting entirely accurate information, but getting the story out there was the only way to reach the people who would tell me what was really going on. It’s not often that I do this, but I could not see any way around it.

After receiving a tip that the hours of some Sandburg Mall employees had been cut, I called Mike Kohan, the point man of the New York-based company that owns the mall. He adamantly told me that no one was laid off, only hours were cut. He also surprised me by leveling criticism at many of the mall’s employees.

"Business Notebook" -- Last week I wrote a story in which I suspected I was not getting entirely accurate information, but getting the story out there was the only way to reach the people who would tell me what was really going on. It’s not often that I do this, but I could not see any way around it.

After receiving a tip that the hours of some Sandburg Mall employees had been cut, I called Mike Kohan, the point man of the New York-based company that owns the mall. He adamantly told me that no one was laid off, only hours were cut. He also surprised me by leveling criticism at many of the mall’s employees.

On Thursday, Kohan called, after not returning two calls Wednesday, and said the call Monday “came out of the blue” and “it had really slipped my mind” that all customer service employees were let go.

The day after Monday’s story appeared, the phone started ringing. At least half of the people laid off — as it turned out there were layoffs — called. All were outraged at being put on the unemployment rolls with no prior notice, then having the mall’s owner tell the local newspaper that there were no layoffs.

Let me be clear it is not my job to say whether the layoffs were needed or not. Kohan sees the financial numbers, I don’t. And, I am a reporter, not an accountant, so it’s doubtful I would know if layoffs were needed or not, even had I access to the mall’s books.

There are some things I do know, however. I know from talking to the people let go how hurt they were to have their work ethic called into question. And, to hear those daily trips to the Illinois Department of Employment Security office were an illusion, as no one was laid off. I doubt that hearing that Kohan forgot all about it will make them feel any better, although it is true the company owns many malls and he is based in New York, not Galesburg.

It’s no secret that Sandburg Mall is struggling. Osco, Waldenbooks, Maurices, Fashion Bug, Diamond Dave’s and the mall twin cinemas are just a few of the businesses that have left. Many of the stores were part of troubled national chains, so it’s not fair to blame the owners of the mall for all of the departures, maybe not even most of them.

But, talking with a couple of experts in the field for my Sunday business front story, I learned that malls have to adjust to the times. Coming up with a theme, brightening up the inside of the mall, are among approaches that might help attract new tenants when retailers start seriously looking at markets the size of Galesburg again.

It’s not surprising that Kohl’s chose to build at Seminary Square, as that chain normally is not found in enclosed malls. As is the case with the store in Willow Knolls in Peoria, Kohl’s often looks to an outdoor shopping center that is larger than a strip mall but not as big as a full-fledged mall. Kohan feels that customers attracted to Kohl’s will also come to the mall. He thinks the entry of Kohl’s into the local market will help, not hurt, Sandburg Mall.

I’m sure the mall would have loved to land Dunham’s Sports, which will open at the end of the week on North Henderson Street. I’m sure Kohl’s and Dunham’s both looked at many sites and had good reasons for their choices.

What should be encouraging to Sandburg Mall officials is that there is a thawing in the freeze on new stores many retailers had in place after the Great Recession. Assuming we are not thrown into financial chaos by a failure by the president and Congress to agree on an increase in the debt ceiling — hopefully, such an agreement came about between the time I wrote this and when it was published — this could mean other chains will look at the mall.

Speaking with one of the experts for my story on open-air lifestyles malls vs. enclosed malls, it was encouraging that one said if the mall can “weather the storm,” it’s still possible for it to bounce back. However, according to another specialist in this field, certain tenants may demand an upgrade in the look of the mall, which would be good for customers and the mall itself, making it more attractive to customers and other retailers.

I am concerned that the entire customer service staff was laid off. I hope Kohan is correct that the reduced-hours employees will be able to keep the center clean, as this is part of weathering the storm.

The idea of all this is not to embarrass Kohan or the mall but to report the truth. To do otherwise devalues the worth of the people who are now out of work.

Does the current ownership of the mall have the desire and/or resources to do what must be done to get the center back on its feet? I don’t know. If there is help available from the city — similar to the facade grants downtown — or any other grants or low-interest loans, I suspect that would be a major shot in the arm.

I think the vast majority of Galesburg and area residents would like to see all retail flourish here. The more stores, restaurants and entertainment options there are from which to choose, the better for consumers and even other businesses, as shoppers come from a wider area.

John R. Pulliam is business reporter at The Register-Mail. Contact him at 343-7181, ext. 215, or jpulliam@register-mail.com.

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